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AN INTRODUCTION

TO COIN COLLECTING

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TABLE OF CONTENTS INTRODUCTION AND HISTORY 3 WHY COLLECT COINS? 3 METALLURGICAL STRUCTURE OF COINS 3 ANATOMY 3 HOW ARE COINS MADE? 4 GRADING 4 GOLD AND RARE COINS 5 HOW AND WHERE TO START 5 STORING AND PRESERVING YOUR COINS 6 BUYING COINS 6 COIN COLLECTING KIT 6 FUN FACTS 6 CONCLUSION 7

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INTRODUCTION AND HISTORY The collection of coins falls under the umbrella of Numismatics, which is the collection and study of coins, paper currency, medals and tokens. Coin collecting is an ancient and much pursued hobby, dating back to millennia. Evidence has proven that coins were being collected by individuals, scholars and state treasuries as far back as in Ancient Rome, as well as in medieval Mesopotamia. However, it was not until the fourteenth century, during the Renaissance, that coin collecting became a cherished pastime amongst aficionados, mainly from the nobility class which included kings and queens. Ever since then, coin collecting has been referred to as “The Hobby of the Kings.” For several hundred years since, it remained a hobby for the rich and more privileged members of society. However, during the 17th and 18th centuries, the rise of Numismatics as an academic and educational system fostered an interest in a more studied approach towards the collection and cataloguing of coins, hence adding to it another dimension and a new audience of practitioners. The study and wonderful hobby of coin collection gained further prominence during the 18th and 19th centuries, amongst several classes of society and people from all walks of life and age groups. As a result, coin collecting as a hobby and profession is widespread during the present day. Today, there are numerous publications, bodies and events that promote the collection of coins, such as periodicals, coin clubs and societies, regulatory bodies, coin shows, trade associations and international conventions. WHY COLLECT COINS? Coins are collected for various reasons. However, there are three general kinds of motives for collecting coins: As a hobby – This is the most common reason for collecting coins and the most enjoyable. Initially, coin collection is a fun and educational way of passing time. However, as hobbyists advance in their passion for coin collection, their focus of collection becomes more centralized to a specific era, country, year of minting or metal. For academic purposes – Numismatics collect coins to study them. Coins of a particular era can reveal valuable historic information, such as the culture, mentality and language of the people during that era. For investment – Many collectors collect rare or precious coins for the motive of selling them for considerable amounts of money. An investor has to be an expert about coins, in regard to their history, grading, market value and many other factors. METALLURGICAL STRUCTURE OF COINS Coins are constructed from an assortment of different metals. These include Gold, Silver, Copper, Nickel, Zinc, Lead, Magnesium, Iron, Platinum, Manganese, Tin, Palladium and Tungsten. Most coins are made from a combination of these metals, or alloys. For example, a U.S. penny is composed of copper plated zinc, whereas a quarter is constructed from nickel plated copper. In the 18th century, U.S. dollars were made of silver and later, from gold in the 19th century. ANATOMY

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As a beginner, it is important and fun to learn about the basic anatomy of coins. In addition, knowledge of coin anatomy or any other aspect of coins will help you gain a lot of attention and respect with your fellow collectors, as well as coin dealers. Here are some of the common features of a coin’s anatomy:

Coins have two faces: the obverse, which is commonly known as the “heads” side of the coin and the reverse, also called the “tails” side.

The “edge” is the outer border of the coin. It can be either plain surfaced, reeded (or ridged), lettered or decorated.

The coin’s “rim” is the narrow, circular and raised edge bordering the head or tails surface of the coin.

The “legend” is the main inscription on the coin. For example, the inscription on a U.K. one-pound coin is ELIZABETH II DEI GRATIA REGINA FIDEI DEFENSOR.

The “motto” is the inscription on the coin’s obverse.

The “mint mark” is a small letter or symbol which will tell you where the coin was manufactured. For example, one of the mint marks used on U.S. made coins is San Francisco (S).

The “relief” is the area of the coin’s surface which is raised. This can be a portrait or a letter of the alphabet .

The “field” is the flat area of the coin’s surface. HOW ARE COINS MADE? The process from which coins are made is a very interesting and knowledgeable topic for a beginner to know. First, the metals used to make the coins are heated in a furnace into molten form. The molten metal is then transferred into a mould to cool. The result is a solid metal bar which is then repeatedly pressed through a roller, until it is shaped into a coil or strip. The thickness of the coil is predetermined and set to be the actual thickness of the finished coin. Next, a blanking press is used to punch circular discs, or ‘blanks’ through the coil strip. The remainder of the coil is cut up into pieces for recycling. The blanks are then transferred to an annealing furnace for softening, after which they are purified by washing and drying, in order to get rid of any remaining dirt and grease. Next, the cleaned up blanks are put through a riddler, which rejects the imperfect blanks that are later recycled. An upsetting mill is next employed to raise the rims of the good blanks. In the final step of the mechanical process of coin construction, designs are imprinted or struck upon the blanks’ surfaces via the coining press. This striking involves the usage of two dies, one for the blank’s obverse side’s design and another for the reverse side. At the end of this process, the blanks have finally become coins. After a careful and detailed manual inspection, the new coins are put in an automated counter for counting, before being transferred for the packaging and sealing processes. The coins are then distributed to banks to be circulated. GRADING Grading is a system used to determine a coin’s worth and condition. Early grading systems graded coins according to three general classifications – good, fine or uncirculated. The grading system now employs numerous criteria for critical analysis, out of which four are the most essential and commonly used:

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Grading by Quality – This system uses the Sheldon Scale method, which is a scale from 1 to 70 to grade coins (70 being the highest grade of quality). Grading by Interest – The interest factor helps determine a coin’s value by assessing it’s worth in terms of its demand in the market. The higher its demand is, the higher the grade. Grading by Rarity – Rarity of coins is determined via three scaling systems:

1. Sheldon Rarity Scale: Uses a range, R1- R8, where R1 indicates common and R8 indicates unique. 2. Universal Rarity Scale: Uses a range, URS 1 to URS 20, where URS 1 designates unique and URS

20 denotes availability in numbers (from 250,001 to 500,000). 3. Scholten scale - Grades by the notations C (Common), N (Normal), S (Scarce), R (Rare), RR (Very

rare), RRR (Extremely Rare) and RRRR (Utmost Rarity) Grading by Liquidity – Based on a scale of 1 to 5, this system assesses how easily a coin would sell in normal market conditions, if auctioned. GOLD AND RARE COINS Gold coins are the most precious items in a coin collection and can be worth millions. Gold coins were the oldest forms of money and are no longer circulated, which makes them quite rare today. Gold can be reserved as a form of investment and owners are always speculating as to their market value. Gold coins are also held as insurance. Some collectors of gold coins cherish them for their historic value alone. Apart from being fun, coin collection can also be a money-making venture and rare coins hold a value that is ideal for that purpose. Collectors and buyers seek rare coins because they are also considered as pieces of rare art, due to the special engravings they carry, as well as valuable historic information about a specific culture or era that they represent. Hence, rare coins can be held as a valuable investment. HOW AND WHERE TO START A good starting point is to ask yourself why you want to collect coins. Some people collect coins as a hobby, which is not only fun, but a very educative pursuit. Others collect rare or precious coins with the intention of selling them for a fortune. Whatever your purpose, starting a collection can be easy. With such an amazing variety of coins, originating from numerous countries from past and present, you can begin by choosing a particular country or era and start from there. You can also learn more about the particular kind of coins you want to collect by researching via the internet or books from your local library. You can also subscribe to the numerous coin publications out there, or even visit the local coin shop for pointers. As you progress, you are likely to come across other coin collectors with whom you can pick up valuable tips and even exchange coins. Remember – do not feel shy in asking question from more experienced coin collectors, as they can give you valuable advice which you cannot get from a book or the web. Joining a coin club is another fun and useful way to share your passion with other similar hobbyists, whether amateurs or professionals. As a member of a coin club, you can buy and sell coins and keep

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abreast of the latest ideas, trends and current events concerning the fascinating world of coin collecting. You can search for coin clubs through the internet, newspapers, library, or even at your local coin shop. STORING AND PRESERVING YOUR COINS It is very important that you properly store your coin collection as it starts to grow. Coin folders are cheap and very effective for this essential task and can be easily acquired from the coin or hobby store. Avoid using older coin folders made from polyvinyl chloride (PVC), which can corrode your coins. Remember, the better the quality of your coins, the better the grade they will get and hence the greater their value in money. Never rub or polish your coins as it would only add scratches and decrease your coin’s market value, whether it is for investment or numismatic purposes. Hold coins by their edges and don’t touch the surfaces. Do not handle coins without gloves as skin oils and fingerprints can diminish their value. Also, always consult an expert before attempting to clean coins by yourself. BUYING COINS There are numerous sources from where you can buy special coins. A good place to start is your local coin shop, where you can examine and analyze any coin that interests you. You will also have no shortage of experts and other coin lovers who can help you gain a wealth of information, as well as inspiration to learn more about your hobby. You can also purchase coins at a coin auction, but that would require you to learn the rules and procedures of how auctions work. Another way to buy coins is by mail, which is not only convenient, but involves low overhead costs and prices. To summarize, coin buying can be an easy task, as long as you have done your research about your desired coins and dealers well and seek availability of the best product. COIN COLLECTING KITS Collecting coins can be fun, but it also requires you to be systematic and disciplined. As your hobby grows, you may feel the need to acquire a coin collecting kit to help you become more organized in your coin collecting pursuits. Some of the essential things in a coin collecting kit include:

Coin guides to help you gain special information about coins, grading, pricing, etc.

Inventory records to help you organize your collection by important and useful factors like year, face value, cost, grade, trend, to name a few. Sophisticated software is also available to serve this purpose.

Coin containers to protect your coins from damage caused by long time storage.

Silica gel packets to create the required low humidity storage surroundings and temperature that are essential in maintaining adequate coin preservation.

Magnifying glass to detect hairlines and scratches upon coin surfaces to help with coin grading.

Lamp.

Coin handling equipment like surgical gloves and velvet pads. FUN FACTS

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Long before coins, money consisted of stones, cattle and metal made in various shapes, sizes and weight.

The earliest known coins in existence were made out of bronze by the Chinese in 800-1000BC. Later, people of the Asian continent were using coins in 600-700BC.

The earliest known collector of coins was the Roman Emperor Augustus Caesar, during 63BC-14AD. Caesar not only collected foreign coins, but also gave them away as gifts. Other notable coin collectors of the past included Pontiff Boniface VI and the Italian poet Petrarch, both of whom were avid collectors with impressive coin collections.

The first coins in America were fashioned from copper, during the 18th century.

Coins in circulation have a lifespan of 30 years approximately.

Factors that add value to coins include age, rarity, condition and precious metal.

In 1891, the American Numismatic Association (ANA) was founded with the purpose of promoting collecting as a hobby and the study of coins. The ANA also devised a grading system for U.S. coins, a scale which consists of a lowest grade of About Good-3 to a highest grade of Perfect Uncirculated-70.

The world’s most expensive coin was a silver dollar which was sold for over 10 million dollars, which included commission.

Coin collecting enables one to learn many aspects of minting technologies, as well as economic history and the history related to the images engraved upon coins

A coin dictionary contains coin terminology, which is essential to learn for beginners, in order to become more knowledgeable and successful in their pursuit of collecting coins

When one of the first video games, The Space Invaders was introduced in Japan in 1978, it caused a nationwide shortage of coins and eventually, the Japanese government had to increase the production of coins to fulfill demand.

The 1933 penny is one of the rarest British coins. This is because there was an abundance of pennies in 1933 and there was no need to produce them.

CONCLUSION Coin collecting is not only one of the most enjoyable hobbies to adopt, but also one of the most rewarding. The fascination one experiences in discovering a rare or precious coin is akin to discovering buried treasure. It is indeed this aspect which pulls many people towards this wonderful hobby. And like any other hobby, the higher your level of interest, the greater your knowledge. As you grow in your expertise in coin terminology, grading coins and learning how to preserve and care for your collection, you will find yourself more capable of differentiating high value coins from lesser ones. And whether you collect coins for aesthetic, artistic or profit-seeking purposes, remember that the road is endless and the rewards many. We hope that this e-book has been a source of information and will inspire your budding interest in starting and advancing your own coin collection. Happy collecting!